Retire by 65? Get real, say one in two Americans

Amid a host of persistent and growing financial challenges, a new survey by Equitable reveals a large share of Americans have lost hope on reaching a long-enshrined milestone.

According to the research, which drew from a poll of more than 1,000 participants, revealed nearly half of American consumers believe retiring at the age of 65 is realistic. Rather than 65, a full 47 percent of respondents expect they’ll retire nearly a decade later at the ripe old age of 74.

The study respondents pointed to several challenges in achieving retirement security including rising living expenses (68 percent), insufficient savings (66 percent), and a lack of guaranteed retirement income (39 percent).

And while some may be willing and even happy to put off their retirement, only 18 percent of those surveyed expressed a desire to work beyond 65.

“Today’s world is full of uncertainty, and inflation continues to make everything more expensive,” Nick Lane, president of Equitable, said in a statement. “This is having a profound impact on Americans’ retirement confidence, causing many to feel they will need to work well beyond age 65 to save enough — not out of choice, but rather necessity,”

The survey also revealed a strong appetite for consistent, guaranteed income in retirement, with nearly two-thirds (64 percent) of respondents favoring a steady retirement paycheck over managing withdrawals from retirement accounts.

Millennials proved to be the hungriest for a regular retirement pay stream, with 70 percent expressing their desire. That was followed by Gen X at 65 percent, Gen Z at 62 percent.

Baby boomers, the generation closest to retirement, showed the least interest in guaranteed income – 59 percent – potentially because they’re already drawing from reliable sources such as Social Security and pensions. As traditional pension plans become a thing of the past, there’s a strong clamor for financial support among younger generations to ensure their savings can last throughout retirement.

“Automatic enrollment, automatic escalation, and target-date funds have been game changers in helping more Americans accumulate retirement savings,” Lane said. “However, what’s often overlooked is how to help workers convert their savings into a reliable stream of income in retirement.”

The survey also found 57 percent of Americans see high volatility in the current US economy, emphasizing the necessity for strategies that protect investments and provide steady income. It's no wonder, then, that the demand for guaranteed retirement income solutions such as annuities is greater than ever.

Figures from LIMRA show that US annuity sales hit a yearly high in 2023, surging 23 percent year-on-year to top $385 billion. The sector is on pace to hit that number then some in 2024 as it raked in $215 billion over the first half, the biggest six-month sales haul on record.